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Wed, Sep 05, 2007 - Page 10 News List

Price controls key: Yosano


Japan should not pursue a "devilish" policy of boosting economic growth for its own sake and should focus on keeping prices under control, Japanese Prime Minister Shinzo Abe's new right-hand man said.

"Stabilizing prices is very important for everybody's life and the devilish inflation policy which aims to boost a nominal growth rate would cause people trouble," Kaoru Yosano said in an interview published yesterday.

"It is important to maintain healthy fiscal discipline," he said in a group interview with Japanese media, as quoted by the Sankei Shimbun.

His remarks would appear to contrast with the strong focus of some former governments on raising growth rates. Japan is now in the midst of its longest expansion since World War II. But workers' wages and consumer spending have lagged behind and deflationary pressure has lingered.

Yosano, 69, got the powerful position of chief Cabinet secretary in a Aug. 27 reshuffle by Abe.

Yosano is a longtime free-market advocate and also known for seeking to rebuild Japan's debt-ridden finances by raising taxes, an idea extremely unpopular with voters.

In the past, he has been one of the few senior government leaders to support raising interest rates.

The Bank of Japan last year ended an unorthodox policy of keeping interest rates at virtually zero to stimulate the economy and tackle deflation. The central bank last raised its benchmark rate in February to 0.5 percent.

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